Jakarta. Rupiah extended its losses against the US dollar on Monday as escalating military tensions between the United States and Iran, coupled with mounting domestic political uncertainty, dampened investor sentiment.

The rupiah closed down 44 points, or 0.24%, at Rp 18,109 per US dollar, compared with Rp 18,065 at the previous close.

Ibrahim Assuaibi, director of Traze Andalan Futures, said the rupiah remained under pressure as geopolitical tensions intensified following renewed missile and drone attacks between the US and Iran.

Tehran recently launched heavy missile and drone strikes targeting US facilities across Gulf countries, marking the latest escalation in the conflict.

The renewed hostilities have disrupted energy shipping routes through the Strait of Hormuz, fueling concerns over higher inflation and the prospect of further interest rate hikes.

"Prolonged disruptions could force oil refineries, particularly in Asia, to seek alternative supplies while driving up shipping and insurance costs," Ibrahim said in a statement on Monday.

Domestically, Ibrahim said the rupiah also came under pressure as markets reacted negatively to allegations surrounding a major corruption case involving former Deputy Attorney General for Special Crimes Febrie Adriansyah. He added that tensions among law enforcement agencies could have broader implications for Indonesia's economy.

"Legal certainty is a key component of the business environment. It directly affects economic performance through its impact on business behavior, economic efficiency, investment, and innovation," he said.

Other exchange rates against the rupiah stood at Rp 13,980 per Singapore dollar, Rp 111.72 per Japanese yen, Rp 12,570 per Australian dollar, and Rp 20,657 per euro.

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